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New Member
posted Aug 13, 2022 1:08:39 PM

Does the money I received from my Mother's Prudential Alliance Account upon her death get taxed as income with Fed, Pennsylvania, or local?

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2 Replies
Level 15
Aug 13, 2022 1:18:41 PM
Level 15
Aug 15, 2022 10:08:23 AM

No one can tell you that without more information.

 

In general, if this was a tax-deferred account, like a traditional IRA, then you owe income tax, the same as if the owner had withdrawn the money.  The broker would send you a 1099-R at the end of the year.  

 

If the account held regular investments that were not tax-advantaged, then you inherited those investments on the date your mother died at the value on that date.  If the investments were later sold (cashed out) you might have a taxable gain or a deductible loss.  The broker would send you a 1099-B at the end of the year.

 

The death benefit on a life insurance policy is not taxable.  

 

There are some other, more complicated investments that might be partially taxable. 

 

I suggest you start by asking Prudential.  If you are a subscriber to Turbotax Live, start by asking your Live expert and they can tell you what questions you need to ask Prudential.